Kuan-yin is using anchoring to try to improve sales at her doughnut shop. Which of the following advertisements uses anchoring in an effective way?
a. “Cake doughnuts are $3 each, or buy two for $5.”
b. “Mix and match Long Johns and crullers, all for $2 each.”
c. “Cronuts are just $4—the only ones you’ll find in town!”
d. “Nobody sells glazed doughnuts for less. Just $1.50!”
a. “Cake doughnuts are $3 each, or buy two for $5.”
You might also like to view...
If a monopolist is producing at a point at which marginal revenue is greater than marginal cost, then it should:
a. continue producing at the current level. b. raise its prices. c. lower its prices. d. increase the level of production. e. decrease the level of production.
The trend back toward greater inequality in the 1970s and 1980s was caused by:
A. a fall in the real income of the poor. B. a rise in the real income of the poor. C. a movement toward progressive taxation. D. an increase in government funding for social programs.
When the Fed sells government bonds it ____ reserves and ______ the money supply.
A) increases; increases B) decreases; increases C) decreases; decreases D) increases; decreases
If you know that you can afford a $500 per month car payment for the next 48 months, the interest rate is positive, and you have found a car dealer who will agree to a zero down payment, you will
A. be able to afford something less than a $24,000 car. B. be able to afford a $24,000 car (which is exactly $500 × 48). C. be able to finance a more expensive car when the interest rate is high. D. be able to afford a $25,000 car (which is more than $500 × 48).